It’s important not to let hype overshadow blockchain’s revolutionary and exciting capabilities. Blockchain creates an immutable transaction ledger. This immutability means that transactions are inherently trustworthy; any attempt to tamper with them by, say, duplicating a Bitcoin would be automatically recorded, rendering fraud readily detectable.
It means blockchain users can conduct a secure digital transaction, including international transfers without the oversight of a third party such as a bank. Just like someone can send an email to a friend across the world as quickly as they can email their neighbor down the street, blockchain, and the cryptocurrencies built on them are inherently simple to perform without borders.
Many blockchain companies are using this technology to launch platforms that can handle local and international transactions with equal ease. These companies are bringing blockchain to international finance, healthcare research, and plenty of other global industries. Deedcoin, a new real estate company, is using blockchain to create a dynamic international real estate platform.
The Deedcoin Platform
Deedcoin was founded in recognition of the fact that selling property often costs too much. Realtor fees in the U.S. are typically as high as 6% of the home’s selling value. For a house sold for $200,000 (the median price of U.S. homes sold in 2017), the sum is $12,000, huge for the average seller. High fees are perpetuated by powerful trade lobbying groups such as the National Association of Realtors, who have made efforts in recent years to stomp out more efficient online competitors such as Zillow.
Deedcoin uses blockchain-based transactions to reduce costs to home buyers and sellers. Usually, fees split between the seller’s realtor fee and the buyer’s realtor fee. In the typical U.S. market, this means that the home seller is paying 3% of their home’s value to each realtor.
But sellers and buyers alike can experience dramatic savings by using a Deedcoin-approved agent. These agents will accept a portion of their fee in Deedcoin rather than cash. If both the seller’s agent and the buyer’s agent are Deedcoin agents, for example, the seller only has to pay 1% of their home’s value in cash. The other 5%, split between the two agents, can be paid in Deedcoin, with 10 Deedcoin representing 1% of the home value.
Deedcoin only cost about $1.50 per token during their initial ICO sale, so this represents substantial savings for both the seller (who pays less) and the buyer (who doesn’t have to pay the price for the home that’s been inflated to cover the commission). Only approved and quality-controlled real estate agents will be part of the Deedcoin program. Because their pricing structure gives them competitive choices for buyers and sellers looking for agents, they’ll have to spend far less on advertising and customer acquisition.
Deedcoin’s International Reach
By building their platform on the blockchain, Deedcoin is laying the groundwork to expand their business model beyond the U.S. And plenty of other countries could benefit from Deedcoin’s blockchain-based efficiency. The company is planning expansion into five other high-commission nations in 2019: Mexico (7.5%), Japan (6%), Italy (5%), Germany (4%), and Canada (3%). Deedcoin has already made partnerships with agents in all fifty U.S. states and over 140 major cities, proving that they can operate across broad geographic areas and unique and disparate marketplaces.
Deedcoin will also prove a useful platform for international buyers interested in U.S property. For shoppers from low-commission countries, Deedcoin will be a feasible alternative to the sticker shock realtor fees.
Deedcoin is designed to have long-term utility and scalability to provide democratic efficiency to customers regardless of how large the Deedcoin network grows. Because Deedcoins can be freely traded on cryptocurrency exchanges, their value will be determined on the free market. It’s possible that the value of these tokens may eventually be high enough that Deedcoin property buyers and sellers aren’t saving any money by using them instead of cash. In this case, Deedcoin’s “Alpha” pricing protocol is activated to lessen the number of Deedcoin needed to complete a sale. This control ensures that no matter what price fluctuations the token undergoes, it will always be a useful tool for property buyers and sellers.
Blockchain is allowing industries to operate on an international level in a way they haven’t before. It is also allowing the creation of platforms such as Deedcoin, which enable property buyers and sellers all over the United States (and soon, all over the world) to access a smarter, more efficient alternative to outdated real estate models.